How Much of Your Paycheck Can Be Garnished for a Defaulted SBA Loan?
Learn about the wage garnishment limits for defaulted SBA loans, including how much of your paycheck can be taken, and explore legal protections and repayment options.
Below are excerpts from the Department of Justice's United States Attorney's Manual addressing collection policies relating to debts owed to the Federal Government and how the DOJ collects debts purportedly "due and owing." Please review here and don't hesitate to contact us if you are facing or about to face a past-due SBA debt.
3-10.500Enforced CollectionsWhen a debtor fails to respond to the post-judgment demand letter or to cure a default on the terms of an established payment plan, immediate steps shall be taken to initiate enforced collection proceedings. The rights and remedies available to the United States, and exemptions available to the debtor, under the Federal Debt Collection Procedures Act, 28 U.S.C. §§3001-3308, should be considered in determining the most efficient and effective means to satisfy the judgment.3-10.510Discovery to determine ability to payFull use shall be made of those discovery methods provided for in the Federal Rules of Civil Procedure whenever financial information is not voluntarily provided by the debtor. If the debtor fails to respond to such discovery requests, those sanctions provided for under the Federal Rules of Civil Procedure shall be pursued promptly and vigorously. All financial information which is obtained through discovery shall be thoroughly reviewed and a determination made on how to proceed to enforce the judgment.3-10.530OffsetOffset of a debtor's federal tax return, federal salary, or federal administrative benefit should be undertaken whenever permitted by law.3-10.540Depriving Debtors of Their ResidenceApproval of the United States Attorney should be obtained prior to executing upon a debtor's residence. Normally, execution on a debtor's residence should not be made if the debtor is cooperative and making reasonable efforts to satisfy the judgment. Similarly, execution upon the debtor's personal or real property should not result in the debtor's family becoming a public charge.
If you are struggling with circumstances that involve SBA loan default or a DOT collection action, you deserve professional help! Our attorneys know how to handle SBA OIC and/or DOT collection cases. If you contact us, we can help you settle SBA debt or your DOT collection problem once and for all. After you schedule an appointment, you confer with a dedicated SBA OIC attorney and Federally Authorized DOT Practitioner who can help you through your administrative legal battle. After your claim is resolved, you never again have to worry about your SBA loan default problem or DOT collection problem haunting you. Our team of lawyers has assisted many clients through the years. Now it is your turn! You truly can settle SBA debt for good!
Please contact us at 1-888-756-9969 to discuss the next steps in resolving your issues. If you do not get in direct contact with us immediately, please leave a message with the front office staff with the best day, time and phone number to call you back and we will follow through on that promise.
Millions of Dollars in SBA Debts Resolved via Offer in Compromise and Negotiated Repayment Agreements without our Clients filing for Bankruptcy or Facing Home Foreclosure
Millions of Dollars in Treasury Debts Defended Against via AWG Hearings, Treasury Offset Program Resolution, Cross-servicing Disputes, Private Collection Agency Representation, Compromise Offers and Negotiated Repayment Agreements
Our Attorneys are Authorized by the Agency Practice Act to Represent Federal Debtors Nationwide before the SBA, The SBA Office of Hearings and Appeals, the Treasury Department, and the Bureau of Fiscal Service.
Clients personally guaranteed an SBA 7(a) loan that was referred to the Department of Treasury for collection. Treasury claimed our clients owed over $220,000 once it added its statutory collection fees and interest. We were able to negotiate a significant reduction of the total claimed amount from $220,000 to $119,000, saving the clients over $100,000 by arguing for a waiver of the statutory 28%-30% administrative fees and costs.
Clients executed several trust deeds pledging seven (7) real estate properties and unconditional personal guarantees for an SBA 7(a) loan from the participating lender. The clients' small business failed and eventually defaulted on repayment of the loan exposing all collateral pledged by the clients. The SBA subsequently acquired the loan balance from the lender, including the right to liquidate and collect all pledged collateral pursuant to the trust deed instruments.
The Firm was hired to negotiate separate release of lien proposals for all 7 real estate properties. In preparation for the work assignment, the Firm Attorneys initiated discovery to secure records from the SBA and Treasury's Bureau of Fiscal Service. After reviewing the records and understanding the interplay between the lender and the SBA, the attorneys then prepared, submitted and negotiated the release of lien (ROL) for each of the 7 real estate properties for consideration.
After submitting the proposals, the assigned SBA Loan Specialists approved each ROL package - significantly reducing the total SBA debt claimed.
Clients personally guaranteed an SBA 504 loan balance of $337,000. The Third Party Lender had obtained a Judgment against the clients. We represented clients before the SBA and negotiated an SBA OIC that was accepted for $30,000.
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